Intergenerational transfers, mandatory retirement and economic growth

Lars Kunze ()
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Lars Kunze: TU Dortmund University

Economics Bulletin, 2025, vol. 45, issue 4, 1744 - 1754

Abstract: This paper investigates the relationship between economic growth and the mandatory retirement age in an overlapping generations model with family altruism. It is shown that the relationship between the mandatory retirement age and economic growth is inverted U-shaped so that an increase in the mandatory retirement age beyond its growth-maximizing level may harm growth if bequests are not operative within the family whereas the growth effect is unambiguously positive with operative bequests. Our findings highlight the importance of intergenerational transfers in determining the overall growth effect.

Keywords: mandatory retirement; growth; family altruism (search for similar items in EconPapers)
JEL-codes: D9 O4 (search for similar items in EconPapers)
Date: 2025-12-30
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